Germany to mandate open market sales for new wind, solar plants

(Reuters) – Germany’s cabinet on Wednesday approved plans to require most operators of new wind and solar power plants to sell their electricity independently on the open market, aiming to better integrate renewables into the country’s energy system.

Under a new energy reform, facilities as small as 25 kilowatts will need to self-market their power rather than selling it to the grid at guaranteed prices.

Germany aims to cover 80% of its electricity needs through renewables by 2030, up from 58% currently.

The plans announced Wednesday aim to help the country manage electricity surpluses, which often occur midday during summer and have led to negative electricity prices.

The proposed reform, however, faces uncertain prospects in the current legislative period, after the collapse of Germany’s governing coalition.

Until now, small- and medium-sized plants under 100 kilowatts have been able to sell their electricity to grid operators at fixed, guaranteed rates for 20 years.

The new rules would apply only to new plants, with some exceptions for very small solar installations, such as residential rooftop or balcony-mounted systems.

Berlin aims to reduce the burden of surpluses on the power grid, where excess solar energy can lead to negative prices by requiring more renewable operators to self-market.

Under the draft law, subsidies would no longer be paid out when market prices turn negative, creating incentives to invest in storage systems that hold excess power until prices are favourable.

(Reporting by Markus Wacket and Riham Alkousaa; Editing by Miranda Murray, Alexandra Hudson)